Following the N.J. corruption money trail: Money laundering splintered into political probe

Mitsu Yasukawa/The Star-LedgerLevi Izhak Rosenbaum, who is accused of attempting to broker a $160,000 deal for a kidney donation, is taken into the back of the federal courthouse in Newark on corruption charges.

NEWARK -- What began as a federal investigation into money laundering by Syrian Jewish community leaders in New Jersey and New York two years ago spawned into a broad web of political corruption that enveloped two N.J. assemblymen and three mayors.

At the heart of the probe was the money. The politicians are accused of taking bribes. And five rabbis are accused of laundering it through their non-profit religious institutions, while keeping a cut for themselves. One Brooklyn man, who was among the 44 charged today, was even accused of trying to broker a $160,000 deal for a kidney transplant.

"He openly discussed with targets that he was in bankruptcy and was attempting to conceal cash and assets, and told them he wanted to launder criminal proceeds in increments ranging from tens of thousands of dollars to $150,000 or more at a time, often at the rate of several transactions per week," the U.S. Attorney's Office said in a statement announcing the charges.

In addition to the 44 arrests, federal authorities today seized 28 bank accounts in the names of those charged with laundering money.

The key players, according to federal authorities, include Eliahu Ben Haim, of Long Branch, the rabbi for Congregation Ohel Yaacob in Deal. He is accused of taking payments as large as $160,000 made payable to his charitable, tax-exempt organization and laundering it for a 10 percent fee, authorities said.

Saul Kassin, a prominent rabbi in Brooklyn, and Edmund Nahum, the leader of a synagogue in Deal, orchestrated similar money laundering rings, according to the federal complaints. Brooklyn rabbis Mordchai Fish and his brother Lavel Schwartz were also charged with laundering money.

The money was laundered, in part, through cash houses in Brooklyn, as well as an Israeli named Levi Deutsch, who traveled frequently between New York and Israel. According to the complaint, he told the cooperating witness that his source of cash was the diamond business, and a Swiss banker.

The connection to New Jersey politics, however, came long after the initial investigation began. In June 2007, the expanding money laundering probe led the cooperating witness to be introduced to Jersey City building inspector John Guarini, who is charged with taking $40,000 in bribes from the witness, according to the federal charges.

That launched a wave of meetings where the cooperating witness bribed other officials with envelopes stuffed with cash during dinners in restaurants from Atlantic City to Staten Island, according to the complaints.

The bribes, according to federal authorities, to the key politicians included: